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When to avoid paying off debt

Should you pay off those high-interest credit cards? Maryland borrowers who are seeking debt relief may be shocked to discover that many financial planners would urge against paying off a lump sum of credit card debt. Unless the cause of the debt is addressed, borrowers may easily run up against the same financial difficulties, even if they are able to pay off large amounts at some point in time. If you are considering paying off your high-interest cards, take some steps to make sure that your payments are useful and relevant.

First, when you are paying down debt, you will want to stop using your cards altogether. This may seem like an intuitive statement, but many people simply continue to accrue credit card debt, even after they have paid off a large amount. Do not buy in to excuses that involve accumulation of travel points or bonus miles, for example; spending is still spending. Do not use your credit cards unless an absolute emergency arises while you are attempting to lower your debt load. You can use debit and Paypal for all purchases until those cards are completely paid off.

Next, examine the cause of your financial woes. It is helpful to perform a self-audit to find out how you got in so much debt. Your spending habits may need to change, especially if you have a high amount of overhead invested in rent, student loans and other continuing payments. In addition, some people spend more than they make without even knowing that they are causing their own debt problems. Check your credit card and balance trends using common financial tools to know exactly where your money is going.

Finally, consider developing a realistic credit card debt elimination strategy. Make short- and long-term goals to pay off your cards. Paying off debt is not always a quick fix, but rather a lifetime investment that requires diligence and planning. People who have questions about their financial woes, including inquiries about bankruptcy, can consider speaking to a qualified attorney about their options.

Source:, "When not to pay off your high-interest credit card debt" Nancy Anderson, Oct. 11, 2013

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